I am trying to understand this, but I'm not sure- you want fewer towns because the mini-map looks ugly with all the red dots? (East is more settled because the Founder towns were on east edge- people wanted to sleep in hotels to level/earn money faster). Or is it that you are tired of seeing other people working the same jobs as you? You feel there are too many other players on your screen?
All these things are GOOD for the duelers- lots of targets, not too far away. If the towns are too far apart, then you're going to have duelers staying in your town, attacking your fellow townsman 4 times per day. The 2 reasons I imagine most of them became duelers are 1) it beats working and 2) they enjoy proving they're the better fighter. I think more of them for the first reason, which is why you see so many threads trying to figure ways they can earn MORE money.
I personally think 50 players is too many for one town. But if you figure 40,000 players, and 40 territorys, thats 1000 people per territory. Eventually that might develop into 25 or so towns of 30-50 players each, especially if town combat gets implemented. (I am not looking forward to town combat... seems to me it would develop into something like tribal wars...)
Since the other towns/players have no affect on your rewards for jobs, I don't understand your objection. Unless you're trying to make it a two-teir game? Just like you can't duel another player until they join a town, you can't attack another town until it has 30 people and 40,000 construction pts?